Tariff Concerns Continue Driving Import Growth
In what has become a case of rinse and repeat over the past several months, import levels are expected to remain high in the near-term as retailers work to avoid tariffs on goods from Canada, Mexico, and China imposed by the Trump Administration.
As of March 10, the President has threatened 20% tariffs on products made in China, and 25% on goods from Canada and Mexico. Additionally, imports from all trading partners could also be affected by a new fee of between $1 million and $1.5 million for each time a Chinese-built ship docks at a U.S. port. This additional fee is currently under consideration by the Office of the U.S. Trade Representative.
“Retailers are continuing to bring as much merchandise into the country ahead of rising tariffs as possible,” said Jonathan Gold, vice president for Supply Chain and Customs Policy with the National Retail Federation. “The on-again, off-again tariffs against Canada and Mexico won’t have a direct impact on port volumes because most of those goods move by truck or rail. But new tariffs on goods from China that have already doubled from 10% to 20% are a concern, as well as uncertainty over ‘reciprocal’ tariffs that could start in April.”
He continued, “Retailers have been working on supply chain diversification, but that doesn’t happen overnight. In the meantime, tariffs are taxes on imports ultimately paid by consumers, not foreign countries, and American families will pay more as long as they are in place.”
The Global Port Tracker report from the National Retail Federation and Hackett Associates found that U.S. ports covered by Global Port Tracker handled 2.22 million Twenty-Foot Equivalent Units – one 20-foot container or its equivalent – in January, the latest month for which final numbers are available. That was up 4.4% from December and up 13.4% year-over-year.
Ports have not yet reported February’s numbers, but Global Port Tracker projected the month at 2.07 million TEU, up 6.1% year-over-year. That would be the busiest February – traditionally the slowest month of the year because of Lunar New Year factory shutdowns in China – in three years. March is forecast at 2.14 million TEU, up 10.8% year-over-year; April at 2.13 million TEU, up 5.7%; May at 2.14 million TEU, up 2.8%; June at 2.07 million TEU, down 3.2%, and July at 1.99 million TEU, down 13.9%.
June and July’s year-over-year declines would be the first since September 2023, and July’s volume would be lowest since 1.93 million in March 2024. While tariffs might be a factor in the year-over-year decline, imports were elevated last summer as retailers brought in cargo ahead of what turned out to be a short strike at East Coast and Gulf Coast ports in October.
The first half of the year is expected to total 12.78 million TEU, up 5.7% from the same time last year. Imports during 2024 totaled 25.5 million TEU, up 14.7% from 2023 and the highest level since 2021’s record of 25.8 million TEU during the pandemic.
